Questioned on August 18 about Downing Street's involvement in decisions on how to deal with David Kelly. He said the defence secretary, Geoff Hoon, had called Downing Street on July 3 to say that Dr Kelly had come forward and did not back up all details of Andrew Gilligan's story. The next day Mr Powell met Kevin Tebbit, the MoD's highest-ranking civil servant, David Omand, the Cabinet Office's intelligence and security co-ordinator, John Scarlett, the chairman of the joint intelligence committee, and David Manning, the PM's foreign affairs adviser, to "discuss the fact that this chap had come forward".

He told Lord Hutton that Mr Hoon's telephone call meant "on the face of it" that Gilligan had elaborated his story. A description of Downing Street exchanges followed. They included a Saturday phone call from Alastair Campbell (when Mr Powell was mountain-climbing in Wales) to say that to know of Dr Kelly's existence but not tell the Commons foreign affairs committee (FAC) risked accusations of a cover-up, and a "running meeting" in No 10 on July 7. From various recollections of the meeting that he had gathered, Mr Powell said that the prime minister had asked what Dr Kelly's views on WMD in Iraq were in the event that he was put before the FAC. He was told that he had supported the war, but could say "some uncomfortable things about specific items on which he had views".

A later exchange included an email from Tom Kelly, a Downing Street spokesman, on the day that Dr Kelly was identified in the press. "This is now a game of chicken with the Beeb," he wrote to Mr Powell. "The only way they [the BBC] will shift is [if] they see the screw tightening."

Key exchange

James Dingemans, senior QC to the inquiry: What was, at this stage [after Dr Kelly came forward], the atmosphere in Downing Street? Was it now a situation where people were perceiving that the BBC were going to have to cave in on their story?

Powell: No, I do not think we had such high expectations of the BBC after what we had been through.

Dingemans: Was there any thought of Dr Kelly's role in all this? You know, what he might be going through, with his name now in the press etcetera?

Powell: They were concerned. Anyone in the eye of the storm with the press, you know, has a pretty tough time of it.

Dingemans: Can I take you to a document? It is CAB/1/93. It is an email addressed to you [from Tom Kelly]. "This is now a game of chicken with the Beeb - the only way they will shift is they see the screw tightening." Was Dr Kelly's role in this game of chicken a player or being played with?

Powell: I do not think this is referring to Dr Kelly at all as a matter of fact. I think Tom is a former employee of the BBC ... He had, throughout this, been trying to find a ladder for the BBC to climb down so they could leave this in a dignified way and accept they had got the story wrong. I think he felt by the stage we had got to this point we were sort of locked on confrontation and there was no way that the BBC could gracefully climb out.

Since the hearings Mr Powell is still the prime minister's chief of staff. His brother, Lord Powell (formerly Sir Charles, and an aide to Margaret Thatcher) has been appointed to the board of a firm called New Bridge Strategies, which advises firms on how to exploit the $87bn worth of contracts involved in the rebuilding of Iraq.